How to Maintain a Good Credit Score in Canada | Blog
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How to Maintain a Good Credit Score in Canada

By Staff Writer | May 06, 2019

We’ve all seen the ads on television, in print and on the Internet promoting various apps or services that display your credit score and dispense advice about it. But how exactly do you get a good credit score in Canada, and once you do, how can you maintain it?


What is a credit score?

What may seem like an ordinary three-digit number actually carries a lot of weight. Your credit score is a rating that shows how likely you are to pay off your debts. It is used by various outlets, including:

  • Banks and private lenders, when you apply for a mortgage or loan
  • Credit card issuers, when you apply for a new credit card
  • Property managers, when you inquire about an apartment for rent

Your credit rating is expressed as a number ranging from 300 to 900. The higher the number, the better you are at paying your debts off on time. Each numerical range has a different meaning, expressed in the table below.

Credit Score Ranges and Meanings
Range Meaning
300-599 Poor credit
600-649 Fair credit
650-719 Good credit
720-799 Very good credit
800-900 Excellent credit


According to TransUnion, one of the leading sources of credit score data, a good credit score in Canada is 650 or higher. More power to you if yours is 800 or more. TransUnion and another credit bureau known as Equifax are responsible for calculating and setting credit scores in Canada. When determining the scores, credit bureaus take several elements from your personal credit file into consideration, including:

  • Your payment history
  • Your credit applications
  • Types of credit you use
  • How much debt you carry
  • The length of your credit history

If you are unsure of what your current credit score is, you can obtain this information from various sources. Equifax and TransUnion provide free credit reports, but will charge a small fee to view your actual credit score. You can also get a free report from your bank, credit card issuer or from various websites, such as The latter can also show you what your exact credit score is.

Equifax also assigns weights to certain factors to determine the importance of each towards the calculation of your final score. Other organizations may use a similar breakdown for their calculation processes.

Factors Affecting Your Credit Score
Factor Weight
Payment History 35%
Used vs. Available Credit 30%
Credit History 15%
Public Records 10%
Account Assessments 10%

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Understanding your credit file

When you apply for or activate a credit card or account, the information collected by the credit bureaus is entered on your credit file. The credit file is essentially your identification card in the world of credit. It features vital information such as your name, address, phone number, social insurance number, employment history, and so on.

Some of the information kept on your credit file does have an expiration date. Below is a list of how long each detail remains in your file.

How Long Details Remain on Your Credit File
Detail Duration
Inquiries from credit grantors Minimum 3 years
Declarations of bankruptcy 6 years from the date of your first bankruptcy
Collections 6 years from the last active date
Credit history / banking info
Loans obtained 6 years from initial filing date
Foreclosures, garnishments and/or judgments
Credit Counselling 3 years from date of completion or settlement
Voluntary Deposits
Consumer Proposals
Orderly Payment of Debt (OPD)

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How to improve your credit score

Now that you have a good idea of what credit scores are and what a good credit score in Canada is, it’s time to examine your own score and see how it measures up. Once you know what your credit score is, you can determine your standing. If you credit score is between 650 and 799, you are at the national average and are deemed to have very good credit. More power to you if your score is 800 or above. But if your score is below 650, you may need to work on improving it.

No Quick Fixes

Although it is possible to improve your credit score, it often takes time and there is no quick way to do it. In some cases, quick-fix efforts tend to do more harm than good. The best method of boosting your score is to manage your credit responsibly. Avoid spending beyond your means and signing up for multiple credit cards if you know you cannot afford to do so.

Set Reminders

It’s also a good idea to set reminders for yourself so that you know when your payments are due. These reminders can be handwritten notes, notifications from your mobile device or tablet, emails or even reminders from your banking app, if you use one. Some banking apps also offer an automatic payment option. Paying your bills on time is key, as even if you are a day late with your payment, it could negatively affect your credit score.

Reduce Your Debt

Mounting debt is one of the main reasons why people are late making payments. If you can avoid making a purchase using your credit card, you should. Instead, use cash or your debit card. You can also use your credit report to help map out your accounts and determine how much you owe. A quick look at your credit card statement can also give you this information, along with the amount of interest each account has accrued. One you have that information, begin to hash out a payment plan that takes your current budget into consideration. Focus on the accounts with the highest interest rates first while making minimum payments for the others.

Get Help

If you are still having difficulty making your payments on time, consider contacting your creditors directly or seeking the assistance of a credit counsellor. They can provide you with useful advice and perhaps even help you establish a payment plan for your debts. Getting the right advice is much to your benefit and will not impact your credit score. Rather, the assistance you receive will help you improve your score over time.

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Top tips for better credit

Here are some helpful tips that will help you avoid the pitfalls of missed payments, mounting debt, and other situations that can negatively impact your credit score.

  1. Make sure you pay your bills on time. Even payments that are a day late can be detrimental to your credit score.
  2. If you miss payments, keep them current. If, after missing payments, you manage to get your payment schedule back on track, it will positively impact your credit score.
  3. Watch out for collection accounts. Even if you successfully pay one of these off, it remains on your credit file for a period of seven years.
  4. Don’t be afraid to ask for help. Creditors and credit counsellors can provide you with a wealth of helpful advice for making payments and rebuilding your credit score.
  5. Keep it low. If you must use your credit card for certain payments, keep its balance low and pay it off as soon as possible.
  6. Limit your debt moves. It’s better to pay off your debts rather than transfer them between multiple accounts. Focus on paying off your credit card(s) first, then move on to other accounts that still require payment.
  7. Avoid cancelling unused or inactive credit cards. Some people cancel credit cards they are not using to boost their credit scores. This is little more than a short-term solution to a long-term problem, and it could actually harm your credit score. Additionally, closing an account does not eliminate it from your credit report; it remains on your record and could factor into the calculation of your score.
  8. Avoid opening new credit card accounts. Not only will this add to your debt, but the extra cards can actually be harmful to your credit score.

    Paying off multiple accounts may seem difficult at first, but once you get organized and make it a consistent habit, you will slowly and surely improve your score. Rome wasn’t built in a day, and credit scores are not amended overnight. But if you employ a disciplined approach to the situation and are patient, you can rebuild your credit and ultimately maintain a good credit score in Canada.

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